Relying on "Gut Feeling" Over Cognitive Problem Solving in Decision-Making

question 82

Multiple Choice

Relying on "gut feeling" over cognitive problem solving in decision-making is a phenomenon called __________.

• A) sunk costs error
• B) intuition
• C) overconfidence bias
• D) hindsight bias
• E) escalation of commitment

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Definitions:

Income Stream

A regular flow of money from an investment, property, or other financial assets.

Real Interest Rate

The interest rate adjusted for inflation, reflecting the real cost of borrowing or the real yield on savings.

Perfect Substitute

Two or more goods that can be used interchangeably with no loss of utility by the consumer.

Consumption

The process or activity of using goods and services, reflecting the end-use of products that directly satisfies human needs or desires.